Exam 19: Earnings and Discrimination

Tom and Eric went to trade school at the same time. Each graduated with an associate's degree. They have received similar performance evaluations. Eric's employer is not a good business manager, and the sales manager lost a major deal. Because of the decrease in profits, the employees did not receive raises last year. Tom's employer is a savvy business manager and the sales manager is experienced and works hard. If Tom has higher earnings than Eric, the difference is most likely a function of

Figure 19-6 -Refer to Figure 19-6. Given demand, D1, and supply, S2, how much more do the workers with jobs earn per hour if a minimum wage of $8 per hour is imposed on this market?

If, as some economists believe, changes in technology over recent decades have brought about changes in labor markets, then those changes likely have resulted in

Daryn earns a higher salary than his friend Nick because Daryn is willing to work on the loading dock, whereas Nick prefers to work in an air-conditioned office. The difference in salary could illustrate a compensating differential.

Figure 19-3 The manufacturing labor market. -Refer to Figure 19-3. Suppose the manufacturing labor market, which is non-unionized, is in equilibrium at a wage equal to $25. Suppose now that the AFL-CIO (a labor organization) organizes the workers in the manufacturing market and negotiates a wage of $30 per hour. Because of the union,

Which of the following is not an example of efficiency wages?

Which of the following statements is not correct?

A worker association that bargains with employers over wages and working conditions is called

Other things equal, when the supply of workers is low, one would predict that market wages would be

Discrimination is a reflection of some people's prejudice against certain groups in society.

It is increasingly clear that technological change is the only explanation for an expanding wage gap between high-skill and low-skill workers.

Table 19-2 Source: US Census Bureau and Mankiw's calculations -Refer to Table 19-2. What conclusion can you draw about the changes in the gaps in earnings between skilled and unskilled workers between 1975 and 2011?

Economists who attempt to explain the increasing earnings gap between skilled and unskilled workers offer two main hypotheses:

Which of the following explains why soccer players make millions of dollars in Europe but do not in the United States?

George and Brad are waiters at a local restaurant. The female customers think that George is better looking than Brad. If George earns more than Brad, this could be an example of each of the following except

Profit-maximizing, competitive firms will not discriminate in the hiring of workers unless consumers exercise a preference for discrimination in product markets or governments mandate discrimination.

Scenario 19-6​ The after-school tutoring industry is competitive, and so is the labor market for after-school tutors. Suppose male and female tutors have equal experience and skill. Currently, some tutoring centers are biased and will only hire male tutors, while unbiased tutoring centers desire to hire the cheapest tutors and do not care about their genders. As a result, the equilibrium wage for male tutors is higher than that of female tutors. -Refer to Scenario 19-6. Long run competition in the after-school tutoring market is consistent with which of the following statements, assuming consumers do not discriminate between male and female tutors?

A 1986 study of segregation on early 20th century U.S. streetcars found that the primary source of racial segregation on streetcars was

The fact that movie star Angelina Jolie's salary is much higher than the salary earned by the world's best nurse can best be explained by the

Efficiency wages will raise the quantity of labor supplied to the market.